Dow reports second quarter 2020 results



  • GAAP loss per share was $0.31; Operating loss per share1 was $0.26 and excludes significant items in the quarter, totaling $0.05 per share, primarily related to integration and separation costs.
  • Net sales were $8.4 billion, down 24% versus the year-ago period driven by both local price and volume declines, as the COVID-19 pandemic dramatically impacted results.
  • Local price declined 14% versus the year-ago period, primarily reflecting lower global energy prices. Currency decreased sales by 1%.
  • Volume declined 9% versus the year-ago period. Demand growth in food packaging, health and hygiene, home care and pharma applications was more than offset by weakness in durable good end-markets. Notably, the Company reported 3% year-over-year and 13% sequential volume improvements in Asia Pacific as the economy reopened in China.
  • Equity losses were $95 million versus equity losses of $15 million in the year-ago period, primarily driven by lower results at the Kuwait joint ventures on continued margin compression stemming from COVID-19.
  • GAAP Net loss from continuing operations was $217 million. Operating EBIT1 was $57 million, down from $1.1 billion in the year-ago period. Margin compression and increased equity losses were partially mitigated by the progress against our previously announced expense reduction actions.
  • Cash provided by operating activities – continuing ops. was $1.6 billion, including a release of $526 million of working capital as we managed production to demand. Dow delivered a $639 million increase in cash flow from ops. versus the year-ago period, driven by a strong working capital improvement as well as a $461 million ethylene capacity reservation payment from Olin. Capital expenditures were $273 million and free cash flow1 was $1.3 billion, up $836 million year-over-year. The Company’s ongoing prioritization of cash since spin has resulted in a cash flow conversion1 of 110% on a trailing 12 month basis.
  • Dividend returns to shareholders totaled $516 million in the quarter.
  • Total cash and available committed liquidity at quarter-end was approximately $12 billion, including $3.7 billion of cash and equivalents. The Company paid down nearly $600 million of debt in the quarter, which included full repayment of the previously accessed uncommitted lines, achieving a net debt improvement of more than $740 million year-to-date. Dow has no substantive long-term debt due until the second half of 2023.
  • Dow signed a definitive agreement to sell its rail infrastructure assets and related equipment at six major North American sites to Watco Companies on July 2, with expected cash proceeds at close in excess of $310 million by year end.



Three Months Ended June 30

Three Months Ended March 31

In millions, except per share amounts



vs. SQLY

[B / (W)]


vs. PQ

[B / (W)]

Net Sales






GAAP Income (Loss) from Continuing Ops, Net of Tax






Operating EBIT¹






Operating EBIT Margin¹



(890) bps


(790) bps

Operating EBITDA¹






GAAP Earnings (Loss) Per Share






Operating Earnings (Loss) Per Share¹






Cash Provided by Operating Activities – Continuing Ops






1 Op. Earnings (Loss) Per Share, Op. EBIT, Op. EBIT Margin, Op. EBITDA, Free Cash Flow, Cash Flow Conversion and Net Debt are non-GAAP measures. See page 6 for further discussion.


Jim Fitterling, Dow’s chairman and chief executive officer, commented on the quarter:

Recognizing the significant impact that COVID-19 would have on demand in the quarter, Dow took proactive actions to electively focus on cash and maintain our financial strength with a continued emphasis on safe, reliable operations and disciplined capital allocation. As a result, Dow once again generated higher cash flow in the quarter. We captured solid demand growth in packaging, health and hygiene, home care and pharma end-markets, which partially offset weakness in consumer durable goods. Extended economic lockdowns shifted the inflection point for demand recovery in key markets and geographies into June, where we began to see gradual improvements across most industries. The growing recovery in China and early signs of improvement in Western Europe are positive indicators for the United States and Latin America.

Our proactive cost and cash interventions enabled us to continue to maximize our financial flexibility through the pandemic. We delivered another quarter of improved year-over-year cash flow from operations as we have every quarter since spin. We maintained our liquidity position, further reduced our net debt, and we progressed our strategic priorities by announcing an agreement to divest certain rail infrastructure assets. And importantly, we continued to stay close to our customers, providing new channels to access our solutions, such as our new MobilityScience™ platform for the transportation industry, and implementing enhanced supply chain visibility for them as we managed through this historic period.”


Packaging & Specialty Plastics


Three Months Ended June 30

Three Months Ended March 31

In millions, except margin percentages



vs. SQLY

[B / (W)]


vs. PQ

[B / (W)]

Net Sales






Operating EBIT






Operating EBIT Margin



(690) bps


(470) bps

Equity Earnings






Packaging & Specialty Plastics net sales were $4 billion, down 23% versus the year-ago period. Volume was flat, as growth in non-durable packaging end-market applications was offset by declines from durable end-market exposure. Local price declined 22% from lower global energy prices, and currency decreased net sales by 1%.

Equity earnings for the segment were $20 million, compared to equity earnings of $74 million in the year-ago period. Lower integrated olefin and aromatics margins at the Kuwait and Sadara joint ventures were partially mitigated by improved margins at our Thai joint ventures.

Operating EBIT was $318 million, compared to $768 million in the year-ago period. Targeted expense reductions as well as volume gains and incremental integrated margin improvement in non-durable packaging applications were more than offset by lower demand and integrated margins in durable end-markets.

Packaging and Specialty Plastics reported a net sales decline, driven by reduced polyethylene pricing. Volume was flat as gains in Asia Pacific and Europe, Middle East, Africa and India (EMEAI) were offset by declines in the U.S. & Canada. Latin America volume was flat. The business captured strong demand growth in flexible food and specialty packaging, industrial and consumer packaging, and health and hygiene applications, which was offset by declines in higher-margin functional polymers’ exposure to durable end-markets, notably automotive, infrastructure and construction.

Hydrocarbons & Energy reported lower net sales driven by price declines and flat volume. Declines were driven by lower global energy prices as well as lower cracker by-product prices as result of weak end-market demand.

Industrial Intermediates & Infrastructure


Three Months Ended June 30

Three Months Ended March 31

In millions, except margin percentages



vs. SQLY

[B / (W)]


vs. PQ

[B / (W)]

Net Sales






Operating EBIT






Operating EBIT Margin



(1370) bps


(1480) bps

Equity Losses






Industrial Intermediates & Infrastructure net sales were $2.4 billion, down 28% versus the year-ago period. Volume declined 18% due to reduced demand for durable good end-markets primarily in Polyurethanes & Construction Chemicals. Local price decreased 9%, and currency decreased net sales by 1%.

Equity losses for the segment were $113 million compared to equity losses of $78 million in the year-ago period, primarily due to margin compression in MEG at EQUATE.

Operating EBIT was a loss of $220 million compared to earnings of $154 million in the year-ago period due to much weaker demand, margin compression and increased equity losses.

Polyurethanes & Construction Chemicals reported a net sales decline primarily on lower volume and local prices. Local price decreased due to lower global energy costs. Demand was significantly impacted by the COVID-19 pandemic, particularly in construction, furniture and bedding, and automotive. Volume growth in Asia Pacific was more than offset by declines in other regions.

Industrial Solutions reported lower net sales driven by decreased local prices and volume. Improved demand for pharma and home care applications was more than offset by declines in industrial and oil applications, as well as consumer athleisure apparel. Volume growth in Asia Pacific was more than offset by reduced demand in other regions due to the impact of COVID-19. Local prices declined due to lower global energy prices, with Industrial Specialties prices showing more resilience.

Performance Materials & Coatings


Three Months Ended June 30

Three Months Ended March 31

In millions, except margin percentages



vs. SQLY

[B / (W)]


vs. PQ

[B / (W)]

Net Sales






Operating EBIT






Operating EBIT Margin



(760) bps


(630) bps

Equity Earnings






Performance Materials & Coatings net sales were $1.9 billion, down 21% versus the year-ago period. Volume declined 14% as growth in home care products as well as do-it-yourself (DIY) architectural coatings in the U.S. & Canada was more than offset by a decline in siloxanes. Local price decreased 6%, and currency decreased net sales by 1%.

Operating EBIT was $27 million, compared to $214 million in the year-ago period, primarily due to margin compression in siloxanes and lower demand due to regional lockdowns in response to the COVID-19 pandemic.

Consumer Solutions reported a decrease in net sales due to local price and volume declines in all regions. Demand growth in home care applications was more than offset by volume declines in automotive, construction and personal care end-markets as consumer activities and buying patterns were limited by pandemic-related government mandates. Prices in formulated silicone applications were more resilient than siloxane prices which experienced weaker supply/demand fundamentals.

Coatings & Performance Monomers reported lower net sales due to declines in local price and volume in all regions. Local price declined primarily due to lower monomer prices. While Coatings volume was down overall, the business reported growth in architectural coatings in the U.S. & Canada as consumers favored DIY activities. Acrylic monomers pricing remained under pressure globally on weaker supply/demand fundamentals.


Based on what we’ve seen in the second quarter and into July, we continue to expect a gradual and uneven recovery and, therefore, remain intensely focused on the actions within our control and maximizing our operational advantages,” said Fitterling. “Our disciplined approach to cash generation and capital allocation, in addition to our structural cost improvements, will continue to serve as a solid foundation for us to weather this downturn and position us to capture significant value as markets lift.

For that reason, we will upsize our 2020 operating expense reduction target from $350 million to $500 million through additional structural cost interventions. We will also initiate a restructuring program during the quarter, targeting more than $300 million in annualized EBITDA benefit by the end of 2021. This program includes a 6% reduction in Dow’s global workforce as well as actions to exit uncompetitive assets. While these are difficult decisions, they are necessary to maintain competitiveness while the economic recovery gains traction.

Going forward, we have significant addressable market opportunities that will drive growth as the economy recovers. Global economic indicators and end-markets have begun to show improvement, and we will continue to benefit from our unique competitive advantages – our industry-leading feedstock flexibility, unmatched materials portfolio, and geographic and end-market diversity – enabling us to continue to outperform our peers for the long-term.”

Conference Call

Dow will host a live webcast of its second quarter earnings conference call with investors to discuss its results, business outlook and other matters today at 8:00 a.m. ET. The webcast and slide presentation that accompany the conference call will be posted on the events and presentations page of

About Dow

Dow (NYSE: DOW) combines global breadth, asset integration and scale, focused innovation and leading business positions to achieve profitable growth. The Company’s ambition is to become the most innovative, customer centric, inclusive and sustainable materials science company. Dow’s portfolio of plastics, industrial intermediates, coatings and silicones businesses delivers a broad range of differentiated science-based products and solutions for its customers in high-growth market segments, such as packaging, infrastructure and consumer care. Dow operates 109 manufacturing sites in 31 countries and employs approximately 36,500 people. Dow delivered sales of approximately $43 billion in 2019. References to Dow or the Company mean Dow Inc. and its subsidiaries. For more information, please visit or follow @DowNewsroom on Twitter.

®TM Trademark of The Dow Chemical Company (“Dow”) or an affiliated company of Dow

Cautionary Statement about Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In this context, forward-looking statements often address expected future business and financial performance, financial condition, and other matters, and often contain words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “opportunity,” “outlook,” “plan,” “project,” “seek,” “should,” “strategy,” “target,” “will,” “will be,” “will continue,” “will likely result,” “would” and similar expressions, and variations or negatives of these words. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements.

Forward-looking statements include, but are not limited to: expectations as to future sales of Dow’s products; the ability to protect Dow’s intellectual property in the United States and abroad; estimates regarding Dow’s capital requirements and need for and availability of financing; estimates of Dow’s expenses, future revenues and profitability; estimates of the size of the markets for Dow’s products and services and Dow’s ability to compete in such markets; expectations related to the rate and degree of market acceptance of Dow’s products; the outcome of certain Dow contingencies, such as litigation and environmental matters; estimates of the success of competing technologies that may become available; the continuing global and regional economic impacts of the coronavirus disease 2019 (“COVID-19”) pandemic and crude oil supply and price volatility; estimates regarding benefits achieved through contemplated restructuring activities, such as workforce reduction, exit and disposal activities; and expectations regarding the benefits and costs associated with each of the foregoing.

Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Forward-looking statements are based on certain assumptions and expectations of future events which may not be realized and speak only as of the date the statements were made. In addition, forward-looking statements also involve risks, uncertainties and other factors that are beyond Dow’s control that could cause Dow’s actual results to differ materially from those projected, anticipated or implied in the forward-looking statements. These factors include, but are not limited to: fluctuations in energy and raw material prices; failure to develop and market new products and optimally manage product life cycles; significant litigation and environmental matters; failure to appropriately manage process safety and product stewardship issues; changes in laws and regulations or political conditions; global economic and capital markets conditions, such as inflation, market uncertainty, interest and currency exchange rates, and equity and commodity prices; business or supply disruptions; security threats, such as acts of sabotage, terrorism or war; weather events and natural disasters; ability to protect, defend and enforce Dow’s intellectual property rights; increased competition; changes in relationships with Dow’s significant customers and suppliers; unanticipated expenses such as litigation or legal settlement expenses; unanticipated business disruptions; Dow’s ability to predict, identify and interpret changes in consumer preferences and demand; Dow’s ability to complete proposed divestitures or acquisitions; Dow’s ability to realize the expected benefits of acquisitions if they are completed; the availability of financing to Dow in the future and the terms and conditions of such financing; disruptions in Dow’s information technology networks and systems; the continuing risks related to the COVID-19 pandemic and crude oil supply and price volatility; and Dow’s ability to realize the expected benefits of restructuring activities if they are approved and completed. Additionally, there may be other risks and uncertainties that Dow is unable to identify at this time or that Dow does not currently expect to have a material impact on its business.

Risks related to achieving the anticipated benefits of Dow’s separation from DowDuPont include, but are not limited to, a number of conditions outside the control of Dow, including risks related to: (i) Dow’s inability to achieve some or all of the benefits that it expects to receive from the separation from DowDuPont; (ii) certain tax risks associated with the separation; (iii) the failure of Dow’s pro forma financial information to be a reliable indicator of Dow’s future results; (iv) Dow’s inability to receive third-party consents required under the separation agreement; (v) non-compete restrictions under the separation agreement; (vi) receipt of less favorable terms in the commercial agreements Dow entered into with DuPont and Corteva, Inc. (“Corteva”), including restrictions under intellectual property cross-license agreements, than Dow would have received from an unaffiliated third party; and (vii) Dow’s obligation to indemnify DuPont and/or Corteva for certain liabilities.

Where, in any forward-looking statement, an expectation or belief as to future results or events is expressed, such expectation or belief is based on the current plans and expectations of management and expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the expectation or belief will result or be achieved or accomplished. For a more detailed discussion of Dow’s risks and uncertainties, see the section titled “Risk Factors” contained in Part II, Item 1A of the combined Dow Inc. and TDCC Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2020 and Part I, Item 1A of the combined Dow Inc. and TDCC Annual Report on Form 10-K for the fiscal year ended December 31, 2019. Dow Inc. and TDCC assume no obligation to update or revise publicly any forward-looking statements whether because of new information, future events or otherwise, except as required by securities and other applicable laws.

Separation from DowDuPont

On April 1, 2019, DowDuPont Inc. (“DowDuPont” and effective June 3, 2019, n/k/a DuPont de Nemours, Inc. or “DuPont”) completed the separation of its materials science business and Dow Inc. became the direct parent company of The Dow Chemical Company and its consolidated subsidiaries (“TDCC” and together with Dow Inc., “Dow” or the “Company”), owning all of the outstanding common shares of TDCC. For filings related to the period commencing April 1, 2019 and thereafter, TDCC was deemed the predecessor to Dow Inc., and the historical results of TDCC are deemed the historical results of Dow Inc. for periods prior to and including March 31, 2019. The information in this report reflects the results of Dow and its consolidated subsidiaries, after giving effect to the distribution to DowDuPont of TDCC’s agricultural sciences business (“AgCo”) and specialty products business (“SpecCo”) and the receipt of E. I. du Pont de Nemours and Company and its consolidated subsidiaries’ (“Historical DuPont”) ethylene and ethylene copolymers business (other than its ethylene acrylic elastomers business) (“ECP”).

The separation was contemplated by the merger of equals transaction effective August 31, 2017, under the Agreement and Plan of Merger, dated as of December 11, 2015, as amended on March 31, 2017. TDCC and Historical DuPont each merged with subsidiaries of DowDuPont and, as a result, TDCC and Historical DuPont became subsidiaries of DowDuPont (the “Merger”). Subsequent to the Merger, TDCC and Historical DuPont engaged in a series of internal reorganization and realignment steps to realign their businesses into three subgroups: agriculture, materials science and specialty products. Dow Inc. was formed as a wholly owned subsidiary of DowDuPont to serve as the holding company for the materials science business.

Unaudited Pro Forma Financial Information

In order to provide the most meaningful comparison of results of operations and results by segment, supplemental unaudited pro forma financial information has been included in the following financial schedules. The unaudited pro forma financial information is based on the consolidated financial statements of TDCC, adjusted to give effect to the separation from DowDuPont as if it had been consummated on January 1, 2017. For the six months ended June 30, 2019 pro forma adjustments have been made for (1) the margin impact of various manufacturing, supply and service related agreements entered into with DuPont and Corteva in connection with the separation which provide for different pricing than the historical intercompany and intracompany pricing practices of TDCC and Historical DuPont and (2) the elimination of the impact of events directly attributable to the Merger, internal reorganization and business realignment, separation, distribution and other related transactions (e.g., one-time transaction costs). The results for the three and six months ended June 30, 2020 and the three months ended June 30, 2019, are presented under accounting principles generally accepted in the United States of America (“U.S. GAAP”).

The unaudited pro forma financial information has been presented for informational purposes only and is not necessarily indicative of what Dow’s results of operations actually would have been had the separation from DowDuPont been completed as of January 1, 2017, nor is it indicative of the future operating results of Dow.


For further information, please contact:

Colleen Kay
+1 989-636-0920

Kyle Bandlow
+1 989-638-2417

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